- Stocks finish out the week as it moved the entire week: upside bias but modest gains.
- Earnings continue to turn in solid guidance . . . for the most part.
- Housing prices head lower for the second month, raising worries of a double dip.
- Indices struggling to move higher, but many stocks sport solid moves Friday, presaging a move to the April highs.
OTHER MARKETS
Dollar.
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Bonds.
http://investmenthouse.com/ihmedia/tlt.jpeg
Gold.
http://investmenthouse.com/ihmedia/xgld.jpeg
Oil.
http://investmenthouse.com/ihmedia/xoil.jpeg
THE MARKET
MARKET SENTIMENT
VIX: 18.78; -0.49
VXN: 20.42; -0.76
VXO: 18.53; -0.49
Put/Call Ratio (CBOE): 0.87; -0.09
Bulls versus Bears:
The CROSSOVER from August is long gone but it did its job.
This is a reading of the number of bullish investment advisors versus bearish advisors. The reason you look at this is that it gives you an idea of how bullish investors are. If they are too bullish then everyone is in the market and it is heading for a top: if everyone wants to be in the market, then all the money is in and there is no more new cash to drive it higher. On the other side of the spectrum if there are a lot of bears then there is a lot of cash on the sideline, and as the market rallies it drags that cash in as the bears give in. That cash provides the market the fuel to move higher. If bears are low it is the same as a lot of bulls: everyone is in and the market does not have the cash to drive it higher.
Bulls: 45.1% versus 47.2%. First week to slip in more than a month though holding at an elevated level. Was 45.6% three weeks back. Steady rise since hitting 29% where bears overtook bulls back in early September. Still below the 65% level considered as bearish, above the 35% level below which is considered bullish. Where you would expect for a rally such as this one. The crossover level at 29% bulls is long gone, but it did its job. The high on the last leg was 56.0% after starting at 35.6% on the low in February, the lowest it has been since July 2009 . . . until this last leg. 35% is the threshold level suggesting bullishness. After peaking at 53 on this move the bulls lost some nerve, falling to a new low post- July 2009. Once again bulls peaked out near the 50% level. Bulls have bumped at 50ish since late August 2009, falling to 45ish and then rebounding. Hit a high of 47.7% mid-June on the run from the March lows. Again, to be seriously bearish it needs to get up to the 60% to 65% level.
Bears: 22.0% versus 24.7%. Unlike bulls, bears continued to soften, meaning more bullishness. Down from 28.3% three weeks back. The 37.7% peak at the height of the crossover is well in the rearview mirror but bears remain well below the 35% level considered bearish for the market overall. Hit 18.7% on the low in April. Hit a high of 27.8% level on the prior leg in February. For reference, cracking above the 35% threshold considered bullish. Hit a high on the prior run at 47.2%. For more reference, bearishness hit a 5 year high at 54.4% the last week of October 2008. The move over 50 took bearish sentiment to its highest level since 1995. Extreme negative sentiment. Prior levels for comparison: Bearishness peaked at 37.4% in September 2007. It topped the June 2006 peak (36%) on that run. That June peak eclipsed the March 2006 high (33%) and well above the 2005 highs that spawned new rallies (30% in May 2005, 29.2% in October 2005). That was a huge turn, unlike any seen in recent history.
NASDAQ
Stats: +19.72 points (+0.8%) to close at 2479.39
Volume: 1.587B (-25.99%)
Up Volume: 1.234B (+155.683M)
Down Volume: 405.424M (-648.659M)
A/D and Hi/Lo: Advancers led 1.75 to 1
Previous Session: Decliners led 1.59 to 1
New Highs: 101 (-26)
New Lows: 31 (-1)
NASDAQ CHART: http://investmenthouse.com/ihmedia/NASDAQ.jpeg
NASDAQ 100 CHART: http://investmenthouse.com/ihmedia/NASDAQ100.jpeg
SOX CHART: http://investmenthouse.com/ihmedia/SOX.jpeg
SP500/NYSE
Stats: +2.82 points (+0.24%) to close at 1183.08
NYSE Volume: 772.155M (-26.75%)
Up Volume: 451.726M (-16.457M)
Down Volume: 300.613M (-267.473M)
A/D and Hi/Lo: Advancers led 1.53 to 1
Previous Session: Decliners led 1.11 to 1
New Highs: 236 (-158)
New Lows: 12 (-33)
SP500 CHART: http://investmenthouse.com/ihmedia/SP500.jpeg
SP600 CHART: http://investmenthouse.com/ihmedia/SP600.jpeg
DJ30
Stats: -14.01 points (-0.13%) to close at 11132.56
Volume DJ30: 104M shares Friday versus 178M shares Thursday.
DJ30 CHART: http://www.investmenthouse.com/ihmedia/DJ30.jpeg
Support and Resistance
NASDAQ: Closed at 2479.39
Resistance:
2482 is the recent October peak
2518 is interim peak from April 2010
2530 is the April 2010 peak (2535.28 intraday)
Support:
2434 is the May interim peak and the 78% Fibonacci retracement of the April selloff.
2425 is an interim peak from May 2010
The 18 day EMA at 2419
2382-2395 from 2008
2324-2370 is a range of resistance from early 2008
2341 is the June 2010 peak
The 50 day EMA at 2345
2320 to 2326.28 is the January 2010 high
2319 from the September 2008 peak
2310 is the August 2010 peak
The 200 day SMA at 2297
2273 to 2282 marks bottom of January 2010 lateral peak
2275 - 2278 from the February 2008 and April 2008 lows. Key lows.
2245 from July 2008 through 2260 from late 2005.
2236 is the first August gap point.
A series of interim peaks at 2230ish from the May to August trading range
2221 is the gap down upside point from June.
2205 is the November 2009 peak 2210 (from September 2008) to 2212 (the July 2009 closing low)
2185 to 2195 represent support points for years: December 2004 peak, July to October 2005 consolidation, January, March and July 2008 lows, and October 2009 peak.
2184 is the June gap bottom side.
2169 is the March 2008 closing low (double bottom)
2155 is the August 2010 low and the March 2008 intraday low
2140 from the May and June 2010 lows
2100 is the February 2010 low
2099 is the August 2010intraday low
S&P 500: Closed at 1183.08
Resistance:
1185 from late September 2008
1220 is the April 2010, post-bear market peak
Support:
1174 is the May 2010 high, 78% Fibonacci retracement of April peak
1170 is the prior March 2010 high
The 18 day EMA at 1165
1156 is the Sept 2008 low
1151 is the January 2010 peak
1133 from a September 2008 intraday low
The 50 day EMA at 1138
Bottom of the January 2010 consolidation 1131 to 1136
1129 to 1131 is the June and August 2010 peaks
The 200 day SMA at 1121
1119 is the early December intraday high
1114 is the November 2009 peak
1106 is the September 2008 low
1101 is the October 2009 high and the recent May and June 2010 interim peaks
1084 to 1080 (September 2009 peak)
1078 is the October range low
1070 is the late September 2009 peak as well as several other peaks and valleys even in 2010. Important level.
1065 is the May flash crash intraday low.
1044 is the October 2008 intraday high AND the February 2010 low
1039 to 1040 are the May, June, and August 2010 lows
Dow: Closed at 11,132.56
Resistance:
11,205 is the April closing high
11258 is the April 2010 peak
11,734 from 11-98 peak
Support:
11,100 from the 7-08 low
The 18 day EMA at 10,990
10,963 is the July 2008 low
10,920 is the recent May high
The 50 day EMA at 10,747
10,730 is the January 2010 peak
10,609 from the Mid-September 2008 interim low
10,594 is the June 2010 peak
The 200 day SMA at 10,515
10,496 is the November 2009 high
10,365 is the late September 2008 low
10,285 is the late December consolidation peak
10,260 from the May and June 2010 interim peaks are breaking
10,209 is recent August 2010 low
10,120 is the October 2009 peak
9938 is the August 2010 low
9918 is the September 2008 peak
9855 is the early September peak in its lateral range
9835 is the late September 2009 peak AND the February 2010 low
9829 is the September 2008 closing high
9774 is the May 2010 intraday low
Economic Calendar
These are consensus expectations. Our expectations will vary and are discussed in the 'Economy' section.
November 01 - Monday
Personal Income, September (08:30): 0.3% expected, 0.5% prior
Personal Spending, September (08:30): 0.4% expected, 0.4% prior
PCE Prices - Core, September (08:30): 0.1% expected, 0.1% prior
ISM Index, October (10:00): 53.6 expected, 54.4 prior
Construction Spending, September (10:00): -0.5% expected, 0.4% prior
November 03 - Wednesday
MBA Mortgage Applica, 10/29 (07:00)
Challenger Job Cuts , October (07:30): -44.1% prior
ADP Employment Change, October (08:15): 25K expected, -39K prior
ISM Services, October (10:00): 53.6 expected, 53.2 prior
Factory Orders, September (10:00): 0.6% expected, -0.5% prior
Crude Inventories, 10/30 (10:30)
Auto Sales, October (14:00): 3.75M prior
Truck Sales, October (14:00): 5.07M prior
FOMC Rate Decision, November 3 (14:15): 0.25% expected, 0.25% prior
November 04 - Thursday
Initial Claims, 10/30 (08:30)
Continuing Claims, 10/30 (08:30)
Productivity-Prel, Q3 (08:30): 0.6% expected, -1.8% prior
Unit Labor Costs, Q3 (08:30): 1.9% expected, 1.1% prior
November 05 - Friday
Nonfarm Payrolls, October (08:30): 45K expected, -95K prior
Nonfarm Payrolls - Private, October (08:30): 60K expected, 64K prior
Unemployment Rate, October (08:30): 9.6% expected, 9.6% prior
Hourly Earnings, October (08:30): 0.1% expected, 0.0% prior
Average Workweek, October (08:30): 34.2 expected, 34.2 prior
Pending Home Sales, September (10:00): 0.5% expected, 4.3% prior
Consumer Credit, September (15:00): -3.8B expected, -$3.3B prior
By: Jon Johnson, Editor
Copyright 2010 | All Rights Reserved
Jon Johnson is the Editor of The Daily at InvestmentHouse.com
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